Bulls' hope for tomorrow - busted pattern

zeebra

SPX has been up and down between 1100~1050 for a while, and 1044.5 was Feb's low, it is an important support line, closing below that line means bear wins.

Many traders may set their stop a little bit lower than 1040, when SPX break down 1039~1038, it trigged lots of sells, that's why you saw the waterfall once it below 1038.
since the waterfall only happened during last 45 minutes, and the volume was not large enough to represent the real market intention. If you look at the SPY_5min chart, it is still inside the broadening wedge.  It is very possible that it will hit the lower channel line and bounce up and even break out upwards. It is called "busted broadening bottom".

But, lots of investors see 1040 as an important line to hold. breaking down that line means sell, sell, sell.  Let's see if the market will follow through today's later hour waterfall.

So, even if SPY break down the lower trend line tomorrow, bears need to pay extra attention to see if there will be a sudden bounce, if it bounce back to above the lower trend line, SELL SHOT, or BUY TO COVER.

P.S.
If huge gap up above 1044.5? CUT LOSS and walk away.
If little gap up below 1040~1044? do nothing, wait and see.

sooners

回复 1# zeebra


   

maldini

xnz

thanks

southware

thanks

ppteam

Not many traders set stop right below 1040. It's just another number, so is 1000.
Before yesterday and today, the question should have been how the market would break it, instead of if.

For the buyers buy at this level, they'd be happy to buy at lower level. Wrong or right is another matter.

everest001

Thanks!

babyruth

btmarket

Thanks.

slcgh

胡同儿串子

load and clear!

Diver

SPX has been up and down between 1100~1050 for a while, and 1044.5 was Feb's low, it is an important ...
zeebra 发表于 2010-6-30 22:59

COS

cartier

ZZzz2000

回复 1# zeebra

弱弱地问一声，楼主画的线是不是意味着 MACD 背离呀？

happyface

make sense. thx

niufen88

thanks

yanjun